Today is the first day back in session for the Senate after its Thanksgiving break.
As one of its major items on its agenda, in addition to authorizing military spending and increasing the debt ceiling to finance government operations, is the bill to build back better, which the House passed on Nov. 19.
The bill has many important aspects, but the extension of the child tax credit might be one of the most significant for families.
Last summer, the Trump administration signed into law a pandemic-driven America Rescue Plan.
Families with children under 18 received an average of $250.
While $300 per month, a higher amount was given to families with children younger than age 6.
This deposit has been going into many Americans’ designated bank account who qualify, but it is noteworthy to say they are ending that program at the end of December.
As part of the Build Back Better bill, the same amount would continue through 2022.
It was originally proposed by President Biden to extend it until 2025, but that was negotiated down by Lawmakers.
The program is open to married couples whose combined annual earnings don’t exceed $150,000 and unmarried tax filers whose combined annual earnings don’t exceed $112,500.
As the bill needs a simple majority in the Senate to pass, so far, Arizona Sen. Krysten Sinema and West Virginia Sen. Joe Manchin are concerned about the elements of the Bill.
Republicans did not vote for the bill in the House, and certainly, Richard Burr and Thom Tillis are unlikely to support the legislation.
Tillis said, among other things that:
“The Democrats’ tax and spending spree won’t build back better – it will only make life harder for Americans already struggling to get by.”
Even though it might be amended or adjusted, the Senate would at least adopt the bill. After that, it would go to the House for last approval. After that, then, President Biden would need to sign off on it. There is no telling when or how that will work out.
Whichever way, there is one certainty you should know right now. The Internal Revenue Service (IRS) will not report any payments made for the child tax credit as income for the tax year 2021.
It is important to keep in mind, however, that you may lose the child tax credit if your income exceeded the threshold that the IRS used in determining whether you were eligible.